The Board of Directors of the General Authority of Zakat and Tax (GAZT), chaired by His Excellency the Minister of Finance Mohammed Al-Jadaan, has approved the implementing regulations governing the excise tax on Ramadan 5, 1438 AH.
The regulations have been issued as part of GAZT’s preparations for implementing the excise tax, endorsed by the royal decree No. D/86 dated 27/8/1438 AH and published in Umm Al-Qura newspaper on Sha’ban 30, 1438 AH, May 26, 2017.
They will be implemented on Sunday 16/9/1438 AH, June 11, 2017, 15 days after the publication in the official gazette.
GAZT have organized a campaign to raise the awareness among taxpayers, including importers and manufacturers, of excise tax and excisable commodities (tobacco and its derivatives, fizzy drinks, energy drinks).
The campaign included media communication and advertisement as well as workshops held in cooperation with local chambers of commerce and industry.
In the workshops, the taxpayers, who have been informed of the details of the excise tax, had some comments on certain provisions of the implementing regulations.
Seeking to maintain the flexibility of the taxpayers’ work and avoid negative impacts on their activities including manufacturing, storing, transportation, distribution and collection, GAZT amended some of such provisions, in response to the comments of the taxpayers.
GAZT will continue its campaign to raise awareness on the excise tax through a number of communication activities, including the authority’s website, at which the implementing regulations of the excise tax and an updated version of the FAQs on the new tax were made available.
Taxpayers can also call “199099” to ask any question and follow up GAZT account on the social networks where GAZT will post guiding messages.
As per the implementing regulations of the excise tax, the tax will apply to those who offer excisable goods for consumption, whether exporters or manufacturers, those who are licensed to transport excisable goods notwithstanding the suspension cases, those who are licensed to sell excisable goods upon complete damage or loss of the goods without proving that this damage or loss was beyond their control, those licensed to sell excisable goods when such goods will be released from suspension status, any person who has excisable goods for which taxes were not suspended and at the same time were not paid, if that person fails to prove that he/she did not know that the excise tax had not been paid for this item and any other person offering excisable goods for consumption.
As for the transition period of 45 days from the date of application, the Regulations stated that the excise goods that are in possession at the date of the tax application inside the Kingdom shall be immediately subjected to the excise tax, provided that such excisable goods are dedicated for commercial purposes, with tax base exceeding SAR 60,000 in accordance with Article 8 of the regulations, are not owned by any governmental entity, and are not under status suspending duties.
The holders of the excisable goods shall calculate the tax in accordance with the excise law provisions and submit a transitional tax declaration to GAZT 45 days after the date in which the regulations came into force.
GAZT called upon taxpayers to read, understand and comply with the excise tax law as well as its implementing regulations and ask for any unclear points to preserve the rights of the state and taxpayers and to avoid the stipulated penalties.